| Daley v M/S Capital NY LLC |
| 2007 NY Slip Op 07328 [44 AD3d 313] |
| October 2, 2007 |
| Appellate Division, First Department |
| Timothy Daley, Appellant, v M/S Capital NY LLC,Respondent. |
—[*1] Sperber Denenberg & Kahan, P.C., New York (Eric H. Kahan of counsel), forrespondent.
Order and judgment (one paper), Supreme Court, New York County (Leland DeGrasse, J.),entered November 23, 2005, which granted defendant's motion for dismissal of the complaint,denied plaintiff's cross motion for summary judgment as premature, and declared that defendantis not required to enter into a new Section 8 Housing Assistance Payment Contract (HAPcontract) upon renewal of the parties' rent-stabilized lease, unanimously reversed, on the law,without costs, the motion denied, the cross motion granted and summary judgment awarded toplaintiff declaring that defendant's obligations under the section 8 HAP contract continue uponrenewal of the subject lease.
It is uncontested that plaintiff's tenancy has been subject to rent stabilization since itsinception in January 1992 and since May 1996 has been governed by an HAP contract and leaseaddendum under the section 8 Tenant-Based Assistance Housing Choice Voucher Program of theUnited States Department of Housing and Urban Development. In late 2004, defendant landlordinformed plaintiff that his rent-stabilized lease would be renewed in May 2005 but that defendantwould no longer participate in the section 8 program. Plaintiff then commenced this actionseeking a declaration that defendant's obligations under the lease and HAP contract extend intoany renewal period. Defendant interposed a pre-answer motion to dismiss for failure to state acause of action (CPLR 3211 [a] [7]), and plaintiff cross-moved for summary judgment directingdefendant to accept section 8 benefits upon renewal (CPLR 3212).
The issues raised by this matter are governed by the Court of Appeals' decision in Rosario v Diagonal Realty, LLC (8NY3d 755 [2007], affg 32 AD3d 739 [2006]). It is now settled that a section 8subsidy is a term and condition of the lease that must be incorporated into any lease renewal onthe ground that a renewal lease must be on the same terms and conditions as the expiring lease(Rent Stabilization Code [9 NYCRR] § 2522.5 [g] [1]). Contrary to defendant's contentionthat the protection afforded by this rent stabilization provision is preempted by federal law, theCourt of Appeals discerned no explicit Congressional purpose to preempt state law; rather, itnoted an intention to limit the involvement of the federal government. The Court noted that thestates retain broad regulatory power over both housing conditions and the relationship betweenlandlord and tenant. It found that the 1998 amendment to the section 8 program (Pub L 105-276),limiting the requirement that a landlord demonstrate good cause before evicting a [*2]tenant to proceedings brought during the lease term (42 USC§ 1437f), neither hinders compliance with the state law governing the terms of a renewallease nor interferes with the purpose of the federal statute to encourage participation in thesection 8 program. Thus, the Court perceived neither an implied intention to occupy thelegislative field nor any actual conflict between federal and state law (see also Balbuena v IDR Realty LLC, 6NY3d 338, 356 [2006]).
While a summary judgment motion interposed prior to joinder of issue is normally premature(CPLR 3212 [a]; City of Rochester v Chiarella, 65 NY2d 92, 101 [1985]), "in an actionfor a declaratory judgment, the court has an exceedingly broad discretion in deciding the issues"(Cahill v Regan, 5 NY2d 292, 298 [1959]). It is error to dismiss a complaint seekingdeclaratory judgment even where the plaintiff is not entitled to the declaration sought (Lanzav Wagner, 11 NY2d 317, 334 [1962], cert denied 371 US 901 [1962]). Where, ashere, the disposition is on the merits, a declaration should be made (Hirsch v Lindor RealtyCorp., 63 NY2d 878, 881 [1984]). Concur—Tom, J.P., Andrias, Marlow, Nardelli andMcGuire, JJ.